Melbourne's WMC pain is gain for Perth, Adelaide

Page Tools

WMC Resources' magnificent seven - its top seven executives -
will carry away $30 million on their departure from the
Melbourne-based mining group, now busily being wrapped into BHP
Billiton's global empire following the success of its $9.2 billion
takeover bid.

Former WMC managing director Andrew Michelmore wins hands down
in the take-home stakes with an estimated collect (including
entitlements and shares accrued over 12 years) of about $12 million
- easing the pain of his resignation.

BHP took board control on Monday morning, promptly beginning a
series of rolling briefings carrying the message that up to 600
Melbourne head and support office jobs were on the chopping block,
with only 70 positions guaranteed to make their way to BHP's
Lonsdale Street head office.

Rumours continue to circulate that BHP managing director Chip
Goodyear was keen for Mr Michelmore have some consultancy role with
BHP.

Melbourne's pain will be Perth's and Adelaide's gain, with BHP's
decentralised management structure to lead to a significant
increase in the combined BHP/WMC presence in those locations.

BHP reported yesterday that it held 77.41 per cent of WMC and no
longer held an economic exposure to 4.31 per cent of WMC under
cash-settled derivative contracts with Deutsche Bank.

BHP now needs to win over the hearts and minds of the rump of
retail shareholders, who WMC itself has warned might not accept
en-masse because of an emotional attachment to WMC as a 72-year-old
mining group with an exploration record second to none.

The BHP offer has been extended to June 17, with BHP needing to
get to the 90 per cent threshold to enforce compulsory acquisition
of the rest.

Meanwhile, BHP moved to win over WMC troops in Perth yesterday
after the public holiday there on Monday.

The main pitch was that Western Australia was set to become the
global headquarters of the mining giant's exploration and
powerhouse nickel division. BHP's main exploration office in
Brisbane will be closed and moved to Perth while WMC exploration
offices in Denver and Lima are also slated for closure.

Later this week, the BHP board will hold its first meeting in
Beijing, with the Chinese Government in negotiations with Canberra
on a nuclear safeguards policy that would allow first uranium sales
from WMC's Olympic Dam copper/uranium mine in South Australia.

BHP's stainless steel materials president, Chris Pointon, will
move from London to Perth under the changes, revealed at a closed
meeting of WMC's 250 Perth staff at the Hyatt Hotel yesterday
morning.

Dr Pointon promised that the jobs of almost all Perth workers
were safe and that they would be joined by staff from other parts
of the group.

Dr Pointon said WMC's lucrative nickel business in WA, already
the world's third-largest producer, would provisionally be renamed
Western Nickel and would assume responsibility for BHP's $1.2
billion Ravensthorpe laterite nickel project being built on the
state's south coast.

Combining the two businesses, which together will produce more
than 180,000 tonnes of nickel a year, would give BHP huge
advantages over competitors, Dr Pointon said.